Mortgage News

Mortgage Lenders - 3 Steps to Clean up Your Credit

A great credit report will have mortgage lenders standing in line to give you a loan.

If you’re getting ready to visit mortgage lenders to secure a loan for the purchase of a new home, you may want to think about your credit. If your credit is bad, here are three steps you can take to clean it up.

1. Request a copy of your credit report: First request a copy of your credit report. The law allows you to get a free copy every year from the three top reporting agencies, TransUnion, Experian and Equifax. Additionally, if you’ve been denied credit, you are also entitled to a free copy. Read the report from all three agencies and ensure there are no mistakes. If you find mistakes dispute them immediately.

2. If you don’t have a credit card, get one. If you don’t already have a credit card, apply for one to establish a credit history. Keep the balance low, or pay it off each month. Showing that you are responsible with a credit card will help build a good credit rating.

3. Pay down existing credit cards: If you are carrying high balances on your credit cards, pay them down. Low balances will improve your credit score. Pay down your credit cards before paying down car payments or other loans.